Film Accounting Glossary
Suspense account
What is a suspense account?
Also called suspense, or holding account.
A suspense account is a temporary holding account for a transaction that cannot yet be coded correctly, used when a payment has cleared but its purpose or department is unconfirmed.
It is a legitimate tool and a dangerous habit: anything left in suspense at a reporting cut-off is cost that is real but unattributed. Clearing suspense to zero before every cost report is standard practice, because auditors treat a lingering balance as a control weakness.
Example
A $7,400 payment clears with no invoice and no department attached, so it parks in suspense. It is real cost with no owner, invisible in every department's variance until someone identifies it. Clearing suspense to zero before each cost report is the discipline.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
A temporary holding account. Any balance sitting in it at a reporting cut-off is treated by auditors as a control weakness.
Common mistake
Letting suspense carry a balance into a reporting cut-off. That is real cost with no owner, and auditors treat a lingering balance as a control weakness.
Related questions
- What is a suspense account used for?
- Temporarily holding a transaction that cannot yet be coded correctly, usually a payment whose purpose or department is not yet confirmed.
- How often should suspense be cleared?
- To zero before every cost report, so no department is reviewing a variance that excludes cost sitting unattributed in suspense.